The U.S. dollar continue its upswing on Wednesday, hovering near 14-year highs despite some profit taking. The greenback traded at 117.64 yen on Wednesday and at $1.0413 to the euro. The dollar index, a measure of the U.S. dollar’s strength against its major trading partners, hit a 14-year high of 103.65 before settling slightly lower during Wednesday’s Asian session, to 103.100.
In Italy on Tuesday, the government announced its intention to borrow 20 billion euros to strengthen its struggling banking sector. Nevertheless, reports out of Italy from only a day ago indicate that the country’s Monte dei Paschi di Siena has raised approximately 500 million euros in a voluntary debt-to-equity offer that could help avoid a state intervention. The bank is also selling shares until Thursday, hoping to raise an additional 3.2 billion euros. Still, a state bailout remains likely.
Oil Prices Edge Higher
Oil prices rose slightly on Wednesday with International Brent crude oil futures trading at $55.57 per barrel, up 22 cents. US. WTI crude oil futures traded on Wednesday at $53.58 per barrel, an increase of 28 cents. The price increases were largely due to expectations that U.S. crude oil inventory will show a draw. Slower trading in advance of the holiday season may also be partially responsible.
"U.S. oil may rise to $54.37 per barrel, as it has broken resistance at $53.36," said Reuters technical commodities analyst Wang Tao. "Brent oil is poised to break a resistance at $55.79 per barrel," he added.
Analysts expect thin trading for the rest of this week and into next week as markets will be closed for the holidays early in the week.